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Proposal for Ethereum token limit

06 april 2018, 21:44

EIP Proposal

Proposal for Ethereum token limit

In the recent Ethereum Improvement Proposal (EIP) issued at the 1st of April, creator of Ethereum has share his thoughts about the possible hard cap and limit of Ether tokens. He suggested, that it might be set at 120,204,432 tokens. In case, if the proposal wouldn't be able to be applied early enough and this number would have been already exceeded, Vitalik Buterin also suggests 144,052,828 ETH or exactly twice the total amount of when the project first started, conducted a token sale and generated the genesis block.

Ethereum

Ethereum is an open source software platform, which enables developers to create their own projects and decentralized application upon it. Currently, it has become the second biggest and well-known cryptocurrency, next to the Bitcoin. They differ quite significantly, as Bitcoin focuses more on providing the digital payment infrastructure, while Ethereum is a base for various types of programs. In case of Bitcoin, it has been known from the beginning that no more than 21 million coins will ever be created. However, in Ethereum case it has been always an open discussion and the project has tried to remain flexible to the various situations. Original issuance has stated that no more than 18 million Ether should be issued each year, however the debate about the hard cap and possible limits has been going on for a long time already.

New algorithm

The talks about possible max number of tokens are again active, as the project is preparing to change its main algorithm, by which new tokens are created. Currently, it is using the regular proof-of-work model, which is used by Bitcoin as well. The tokens are mined by network contributors using special miners, graphic cards and computers. The new algorithm will use an alternative proof-of-stake model, which has been also popular in various other projects. The new tokens will be generated with the help of other token owners. Vitalik Buterin explained that if embraced, it would "ensure the economic sustainability".

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